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National Crisis

Australia's Fuel Shortage Crisis: How You Can Help

As of March 30, 2026, Australia faces a deepening fuel supply crisis. The government has halved fuel excise for three months from April 1, saving motorists 26 cents a litre. Petrol has surged past $2.50/L and diesel has hit a record $3/L. Here's what's happening and how working from home can make a difference.

Current Status: Fuel Excise Halved — Crisis Continues

On 30 March, national cabinet agreed to halve the fuel excise for three months, saving motorists 26 cents per litre at the bowser from Wednesday, April 1. The heavy-vehicle road user charge will drop to zero over the same period. Together, these measures will cost the budget $2.5 billion. National cabinet also adopted a four-phase fuel security plan; Australia is currently at phase two (“keeping Australia moving”). PM Albanese called for more “certainty” from the US on its objectives in the Iran war and urged de-escalation.

Petrol has surged past $2.50 per litre in many areas, and diesel has hit a record $3 per litre in parts of the country. Multiple regional towns have reported running completely out of fuel. WA is at “Level One” of its Hazard Management Plan for energy disruption. The IEA has urged people worldwide to work from home to reduce fuel demand.

Last updated: March 30, 2026

What's Causing the Shortage?

1Middle East Conflict

The US-Israel war on Iran, which began on February 28, has rattled global energy markets. Tehran has effectively halted most traffic through the Strait of Hormuz, a critical shipping lane that handles approximately one-fifth of the world's oil supply. Three oil tankers were hit by Iranian fire in March 2026, and crude oil prices surged past $100 per barrel at the height of the conflict, before easing to around $US95 as diplomatic signals emerged.

2Panic Buying

Fuel sales have increased by 35-40% in some areas as consumers stockpile against potential shortages. Experts warn panic buying creates a self-fulfilling crisis—when drivers rush to buy extra fuel "just in case," it strains distribution networks and triggers the exact shortages people are trying to avoid. Unleaded petrol has surged past $2.50 per litre, premium 98 is around $2.80, and diesel has hit a record $3 per litre in parts of the country.

3Supply Chain Prioritisation

Major fuel suppliers have contracts with metropolitan service stations, giving city motorists priority over independent regional suppliers. Energy Minister Chris Bowen has called the resulting regional shortages "real and unacceptable." Dozens of fishing trawlers have been stranded, and distributors describe it as the worst shortage they have seen.

Australia's Fuel Reserves (March 2026)

38 days
Petrol reserves
Bolstered by IEA release
30 days
Diesel reserves
Critical for agriculture
30 days
Jet fuel reserves
~802 million litres

Important context: Australia is the only International Energy Agency member that does not meet the mandatory 90-day fuel reserve requirement—a rule it has been non-compliant with since 2012. Energy analyst Kevin Morrison notes Australia has been "flouting the IEA's 90-day oil stockpile rule for over a decade." The country imports roughly 90% of its fuel, primarily from South Korea, Singapore, Malaysia, and Taiwan.

Areas Currently Affected

Victoria

  • • Robinvale — completely dry
  • • Hattah — completely dry
  • • Wedderburn — reports of shortages
  • • Bonnie Doon — reports of shortages

New South Wales

  • • Batlow — completely dry
  • • 32 out of 3,000 service stations out of fuel
  • • Rural towns facing rationing

Western Australia

  • • 6 of 765 Fuelwatch stations reported out of fuel (week ending 22 March)
  • • Manjimup — two stations ran dry
  • • Ongerup — fuel rationing for over a week
  • • Great Southern, Wheatbelt, Goldfields, South West affected
  • • WA now at "Level One" hazard management alert

Price Spikes Nationwide

  • • Unleaded surged past $2.50/litre; diesel hit record $3/L
  • • Premium 98 averaging ~$2.80/litre
  • • Perth: $2.50+/litre (30%+ above baseline)
  • • WA FuelWatch (25 Mar): Ampol/Caltex/EG up to 269.9 cpl; BP up to 264.9 cpl; 20+ sites still below 240 cpl
  • • Brent crude eased to $US95/barrel (lowest in a fortnight) after de-escalation signals

Government Response

Federal Government Actions

  • Released 762 million litres from emergency stockpiles (20% of reserves)
  • Temporarily relaxed fuel standards for 60 days (higher sulphur fuel allowed)
  • ACCC directed to monitor for price gouging
  • Regional areas prioritised for fuel distribution

Western Australia Government Actions

  • WA at "Level One" of its Hazard Management Plan for energy disruption — calling for close collaboration between industry and government
  • Appointed Wheatbelt Development Commissioner Rob Cossart as WA's Fuel Security State Controller
  • Formed a new State Management Team of public sector leaders to coordinate a unified government response
  • Allowed road trains to carry heavier fuel loads to regional areas
  • Established Fuel Industry Operations Group (FIOG) — weekly public updates each Friday
  • Priority fuel delivery to Kalgoorlie, Great Southern, Wheatbelt, and South West
  • Identifying supply bottlenecks and working with industry to unblock them, including distributor priority points and backloading requirements
  • Developing a new digital reporting system for fuel stock levels (currently voluntary self-reporting; 6 of 765 FuelWatch stations reported out of fuel in week ending 22 March)

Source: WA Government Media Statement| FuelWatch Price Trends

PM Announces Carpooling Campaign

  • PM Albanese announced a national carpooling campaign to reduce vehicles on the road
  • Working from home remains encouraged but not mandated
  • Unions are demanding the right to work from home during the crisis

Source: News.com.au — Discounts, WFH, carpooling: PM's huge move (March 25, 2026)

National Cabinet: Fuel Excise Halved for Three Months (March 30)

  • Fuel excise halved for three months, saving motorists 26 cents per litre at the bowser
  • Heavy-vehicle road user charge reduced to zero for the same three months
  • Both measures take effect on Wednesday, April 1
  • Combined cost to the budget: $2.5 billion. Treasurer Jim Chalmers declined to say how the cost would be offset
  • National cabinet adopted a four-phase fuel security plan. Australia is at phase two (“keeping Australia moving”). PM Albanese declined to specify what would trigger phase three (“taking targeted action”), saying it would be a decision of national cabinet
  • PM Albanese called for more “certainty” from the US on its objectives in the Iran war and urged de-escalation of tensions

Sources: ABC News — Fuel excise halved for three months (March 30, 2026)| The Guardian — Labor to halve fuel excise (March 30, 2026)| BBC News (March 30, 2026)

Business Pushback Against Remote Work: "This Is Not COVID"

Despite the IEA's clear recommendation that WFH reduces fuel demand, several business leaders have pushed back against government encouragement of remote work:

  • Bunnings boss Mike Schneider warned the government not to "meddle" in WFH arrangements
  • BHP, hospitality tycoon Chris Lucas, and developer Tim Gurner also rejected WFH encouragement
  • Big four banks are holding firm against union demands for staff WFH access
  • Business Council chief Bran Black said WFH should be a "last resort"

The IEA estimates that three additional WFH days per week could cut oil consumption from cars by 2 to 6 per cent nationally. With millions of Australian office workers able to work remotely, encouraging WFH is one of the fastest, lowest-cost tools to cut demand — no rationing needed.

Sources: AFR — Business tells Bowen to back off (March 23, 2026) | AFR — Banks rebuff WFH calls (March 24, 2026)

Industry Fallout: Travel Cuts & Price Hikes

  • Wesfarmers — temporarily suspended corporate travel (Bunnings, Kmart, Officeworks parent)
  • Uber, Qantas, Virgin, Australia Post — hiking prices to offset fuel costs

Notably, Wesfarmers is the parent company of Bunnings — whose CEO Mike Schneider publicly opposed government WFH encouragement on the same day Wesfarmers suspended its own corporate travel.

Source: AFR — Wesfarmers suspend travel, Uber hikes prices (March 24, 2026)

Could Fuel Rationing Happen?

While Energy Minister Chris Bowen has ruled out rationing for now, experts warn it remains a real possibility if the conflict continues.

"If this keeps going... the physical response is a really, really difficult one because it does begin to take you into that territory of rationing."

— Greg Bourne, Former Regional President of BP Australasia

"In a world where a single conflict can immobilise a fifth of global oil trade overnight, relying on luck is not a strategy."

— Macquarie University researcher

The Liquid Fuel Emergency Act

Australia has emergency powers under the Liquid Fuel Emergency Act 1984 that allow governments to prioritise fuel supply or restrict sales during severe disruptions. Under the Retail Rationing Framework, motorists would face daily dollar-value limits on fuel purchases.

The federal government's National Liquid Fuel Emergency Response Plan (devised in 2019 by the Department of Environment and Energy) outlines an escalating series of measures: "light-handed" measures first — an information campaign encouraging carpooling, public transport use, and EV uptake, estimated to save 3 to 5 per cent of general fuel consumption — followed by progressively tighter restrictions if supply worsens.

The most severe measure would allow petrol pumps to shut off once they reach a daily dollar limit set by the energy minister. Environment Minister Murray Watt on 25 March dismissed reports of a $40 cap, saying it was "a document from the then-government, which was released in 2019, and the situation has obviously changed." He urged Australians to "be sensible about the amount of fuel they buy" and "think of each other."

To formally declare a national liquid fuel emergency, Energy Minister Chris Bowen would consult states, territories and industry before making a recommendation to the governor-general. Education Minister Jason Clare said "any talk of rationing, I think it's way too soon to be talking about that."

Source: WAtoday — Australia's emergency plan starts with carpooling, escalates to fuel caps (March 25, 2026)

Global Response

IEA Emergency Release & 10-Point Plan

The IEA coordinated a release of 411.9 million barrels—exceeding all previous interventions combined. It also released a report with 10 emergency measures, including urging people to work from home. At a national level, if workers did an additional three days from home, the IEA estimates it could cut oil consumption from cars by 2 to 6 per cent, with average potential reductions of about 20 per cent for individual drivers.

Countries Already Rationing & Reducing Work Days

Sri Lanka closed public offices on Wednesdays and has a QR code fuel authorisation system. Pakistan mandated a four-day work week for government workers and ordered half of all office staff to work from home. The Philippines mandated a four-day week for public servants. Thailand told public workers to work from home and use stairs to limit energy use. Bangladesh imposed daily limits on fuel sales. Air New Zealand has cut 1,100 flights.

The Agricultural Crisis

The fuel shortage couldn't come at a worse time for Australian farmers. With seeding season underway across much of the country, access to diesel is critical for planting crops that will determine agricultural output for the coming year.

"The timing of seeding operations is absolutely critical in obtaining good yields. A difference of a few days, or even a week, can have a big difference on a good outcome."

— Michael Lamond, Agronomist

The Victorian Farmers Federation reports that entire towns have run dry, and suppliers are struggling to access fresh shipments. With the national grain crop worth more than $20 billion last year, fuel shortages during seeding could have significant economic impacts.

Critical Concerns:

  • • Tractors and farm machinery require thousands of litres daily
  • • Regional suppliers often get lower priority than city stations
  • • Seeding delays could reduce crop yields significantly
  • • Food production chains are at risk if shortages continue

Beyond Agriculture: Wider Industry Impact

Aviation

Qantas has indicated it will need to increase fares, with flight cancellations on the cards if supplies don't improve. Air New Zealand has already cut 1,100 flights due to fuel pricing and supply constraints.

Mining

Junior and mid-tier mining companies are maintaining only five days of fuel supply. Perth fuel prices have surpassed $2.50 per litre—a 30%+ premium over baseline pricing, squeezing operational margins across the sector.

Food Prices

National Farmers' Federation president Hamish McIntyre has warned food prices could rise by as much as 50% if fuel shortages persist through seeding season and disrupt the agricultural supply chain.

Economic Outlook

Analysts warn Australia faces a deep recession if Iran's guerrilla tactics continue to close the Strait of Hormuz. However, Australia's position as the world's second-largest LNG exporter gives the government some leverage in negotiations.

Housing

WA Deputy Premier Rita Saffioti and Minister John Carey hosted a housing industry roundtable on 25 March to discuss the conflict's downstream impacts on the sector. The government says delivering thousands of homes remains a priority despite the fuel situation.

Should Australia Adopt a Four-Day Work Week?

With several Asian nations already implementing reduced work weeks to preserve fuel stocks, at least one Australian expert says the federal government should be seriously considering the same approach.

"That conversation should be being held immediately. Because this [fuel crisis] is not going to end soon, in my view."

— Professor Tina Soliman-Hunter, Energy and Resources Law, Macquarie University

Professor Soliman-Hunter warned that even if the crisis was resolved this week—which she regards as highly unlikely—Australia would still feel its effects for weeks. At least six ships carrying oil bound for Australia have been cancelled due to the Strait of Hormuz blockade.

"We need to make sure that we've got a whole series of escalating actions in place. So first we do things like asking people to work at home wherever possible, then we ask for things like carpooling, and then we might need to go to the four-day work week."

— Professor Tina Soliman-Hunter, Macquarie University

"It would work very well if you're trying to get cars off the road. The question is whether that would be an acceptable shift in Australia, which I'm not convinced about."

— Professor Tina Soliman-Hunter, Macquarie University

Countries Already Reducing Work Weeks

  • 🇱🇰Sri Lanka — ordered state institutions, schools and universities to a four-day week
  • 🇵🇭Philippines — mandated four-day week for public servants
  • 🇵🇰Pakistan — four-day week for government workers plus half staff WFH
  • 🇹🇭Thailand — told public workers to work from home

Source: 9News — Fuel shortage: Australia must plan for a four-day work week (March 24, 2026)

How Working From Home Reduces Fuel Demand During Australia's 2026 Crisis

Perth workers: see our dedicated guide on how WFH can ease the fuel shortage in Perth — including specific recommendations for commuters, congestion stats, and employer talking points.

"Work-from-home is useful for short-term crises and long-term energy planning... it's just one piece of a broader strategy, alongside cleaner electricity, building efficiency, and electrified transport."

— Professor Fengqi You, Energy Systems Engineering, Cornell University (Al Jazeera, March 16)

While individual actions may seem small in the face of a national crisis, collectively the Australian workforce can make a meaningful difference. The IEA has already reduced its 2026 global oil demand growth forecast by 210,000 barrels per day, with demand destruction effects measurable within weeks. The IEA estimates that if workers did an additional three days from home nationally, it could cut oil consumption from cars by 2 to 6 per cent, with average reductions of about 20 per cent for individual drivers. Here's how working from home directly contributes:

Immediate Impact

Every day you work from home is a day you don't commute. With 36% of Australians already working from home regularly, increasing this percentage during the crisis reduces daily fuel consumption significantly.

Emissions Reduction

Fewer cars on the road means reduced demand pressure and lower emissions. WFH saves approximately 242 kg of CO₂ per person annually—multiply that across millions of workers.

Traffic Reduction

Perth commuters lose nearly 3 days annually to congestion. WFH directly reduces traffic, making essential travel more efficient for those who must drive.

Cost Savings

With petrol now past $2.50 per litre, working from home saves significant money. CEDA estimates WFH saves Australians $5,308 annually—that's even more valuable now.

What You Can Do: Work From Home to Help Ease Australia's Fuel Shortage

Working from home is one of the most effective actions office workers can take right now. Every commute you skip frees up fuel for essential workers and regional communities who have no alternative.

  • Work from home if you can. Every commute cancelled is fuel saved for those who can't work remotely
  • Avoid panic buying—take only what you normally need
  • Combine trips when you do need to drive
  • Share the WFH business case with employers who may be hesitant about remote work
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